By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Retailers are taking a mixed stance in pre-holiday-season buying for portable GPS devices, a category that is expected to gain somewhat in units but fall in dollar sales to consumers this year, compared with 2008.
Some retailers, such as Sixth Avenue Electronics, said they will be cautious in buying portable navigation devices (PNDs) for the holidays, while others, including Electronic Express, are buying more aggressively. Car Toys described its buying as “not cautious.”
Overall, PND sales are expected to gain by about 8 percent in units this year over last, and decline roughly 16 percent in dollars due to falling prices, according to TomTom. Average selling prices are down by about 25 percent from last year, said the company.
Looking at sales through August of this year, The NPD Group said unit sales to consumers are up by 6 percent but down in dollars by 21 percent.
Suppliers are offering price promotions for Black Friday that will place a top-brand PND at a $69 street price (compared with a general $99 last Christmas) with off-brands falling as low as $49, said industry sources.
“We'll be buying aggressively. We still think the demand will be there. Not everyone can afford to have a smartphone,” said Abe Yazdian, Electronic Express merchandising VP, noting that the store is targeting a 60- to 75-day PND supply, where last year it ordered for a 90-day stockpile.
Sixth Avenue Electronics mobile electronics director Don Barros said, “We are being more cautious on both in-dash and portable,” but also noted that “this year will be a difficult one to predict.”
Ironically, it may be suppliers that suppress the buying this season, given that retailers were left with huge overstocks after last Christmas.
Andy Frankel, business development and operations VP for GPS supplier Nextar, explained, “I think this year is going to look artificially bad because last year was artificially good. There were so many [wholesale] sales last year that retailers spent the first six months of the year selling through the stuff from last year.” He added, “When a retailer comes in with an order that's really aggressive, we're almost in sales prevention mode. We took back more inventory than we wanted to [from last year], and I know my competitors did as well. Defensive sales and defensive buying are going to curtail the market. The economy is getting better but it doesn't look like it will rebound strongly until next year. But if it rebounds a little and people buy better than anticipated, I think everyone will be okay.”
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.